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Can Blockchain Drive Growth In The Transportation Industry?

In early 2018, the Blockchain in Transport Alliance (BiTA) announced its cooperation with ten major industry leaders. The revelation adds to the rapidly evolving and intriguing cryptocurrency story.

Last year the combined value of all cryptocurrencies rose to nearly $600 billion. This was an almost 3, 500-percent gain for the year, and overall, this was the largest historical gain among any asset class.

A Powerful, Emerging Tech Innovation

Today, industrial insiders are describing the effect of cryptocurrency’s underlying technology, blockchain, as a force that’s positioned to promote a “tectonic shift” across many industries. Innovations such as artificial intelligence (AI), machine learning (ML) and other advanced technologies are driving this transformation.

According to Craig Fuller – managing director of BiTA – blockchain technology is ideal for deployment in the transportation industry. The organizational leader expresses that the technology serves as a bridge of trust between enterprises. This capability can help firms quickly build commercial rapport across the business ecosystem.

Using the technology, stakeholders have everything that they need to know about the logistics of purchased goods, and because of blockchain, they know that the information is reliable. In fact, transparency is one of the greatest benefits that blockchain provides for the transportation industry.

Currently, shipping firms deploy technologies such as radio frequency identification (RFID) tags and IoT telematics to track shipments. However, these technologies do not communicate universally, nor provide simple transparency. Blockchain, however, provides a foundation that allows shippers to easily share granular information with stakeholders.

The technology furthermore provides an unbroken chain of custody for shipments. This capability, that some logistics experts call “bread-crumbing,” allows stakeholders to view and monitor all good exchanges and their condition as they transfer between carriers as well as where goods have been warehoused and how they’ve been transported.

Big Players Want In on the Blockchain Game

Industrial and technology giants such as Ford, General Motors, BMW and IBM have created a consortium to leverage the blockchain framework. The industry leaders want to use the technology to make vehicles more connected and secure for applications such as consumer tracking and payments as well as ride-sharing and insurance purposes.

The group, called the Mobility Open Blockchain Initiative, wants to align the auto industry with technology. For example, many of the consortium members are researching and developing self-driving passenger and ride-sharing vehicles.

Organization members collaborate on projects such as vehicle data tracking as well as identity and historical information recording. Together, they hope to develop an ecosystem where enterprises and consumers have more control and security over transport-related information. They also want to leverage blockchain to manage ride-share transactions as well as store vehicle identification and usage data.

According to Chris Ballenger – head of the consortium – the collaborative is also working on autonomous vehicle payments as well as data-driven applications for autonomous as well as human controlled vehicles. Furthermore, the group wants to develop “usage-based mobility pricing” that sets rates based on congestion, energy consumption, infrastructure demand, insurance rates, pollution rates, vehicle types and other metrics.

By facilitating collaboration between auto manufacturers and other vendors, states organization leaders, the group can accelerate the adoption of blockchain technology to benefit consumers, communities, and enterprises. Additionally, industry leaders believe that the technology can revolutionize the way that consumers and businesses interact, creating new mobility opportunities. This ideology supports the belief that analysts held for years that blockchain can be deployed as an efficient tool for logistics recordkeeping.

Leaders in Transportation Are Collaborating to Promote Growth

The emergence of blockchain technology has encouraged many large enterprises to experiment with the innovation. As an example, the Enterprise Ethereum Alliance (EEA) is composed of 200 organizations. The massive collaborative is the largest open-source blockchain initiative on the planet.

The participating organizations are experimenting with Ethereum blockchain technology. They intend to deploy it in fields such as energy, finance, healthcare, industrial and logistics.

The EEA differs from BiTA in that they focus solely on using the Ethereum blockchain framework, while BiTA works with various versions of the technology. Conversely, while the EEA wants to deploy blockchain technology across many industries, BiTA focuses solely on transportation. BiTA deployments might include:

Capacity monitoring

Compliance

Fraud detection

Maintenance records

Payments and pricing

Performance history

Theft prevention

Quality assurance

BiTA members come from finance, parts supply, cloud computing development, railroad transportation and tire manufacturing fields, among others. The group hopes to make significant progress soon in leveraging blockchain technology for these eight real-world applications.

United Parcel Service, more commonly known as UPS, is another big name that’s aligned with BiTA. The shipping conglomerate wants to eliminate paper from its operations and improve transaction accuracy as well as the service experience for stakeholders.

The massive global software giant SAP has also joined the organization after committing to a $2.2 billion investment over the course of five years to develop the Internet of Things (IoT). The software mega-corporation intends to leverage the technology for supply chain management, manufacturing and logistics. With the transportation industry bonding together with technology leaders in this fashion, they might just outpace the finance field in adopting the latest in blockchain innovation.

DISCLOSURE:
The author has no affiliation with nor has been compensated by the entities mentioned in this article.

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